Facet One of Social Media and Community Banks - Employees Just Say No
May 29, 2015
Bankers care deeply about the communities they serve. I need look no further than recent CBE interviews or the good work in my own community funded by local banks or their employees. Stalwarts in community arts, fundraising and development, community bankers are not selfish about the giving of their time, talent and treasure. Local communities are better off because they are served by a community bank.
Unfortunately, good deeds are not enough to safeguard that hard-earned reputation. As Benjamin Franklin said, “It takes many good deeds to build a good reputation, and only one bad one to lose it.” One must be vigilant and assertive in protecting a reputation, especially in today’s world of instant communications and viral messaging.
Social media pervades our culture. It is one of the most, if not the most, impactful methods of marketing and communicating today with customers and prospects. A financial institution ignores this medium at its own risk. But, a bank should embrace this medium only after careful planning, training and adoption of a board-approved social media policy. Failure to lay this basic groundwork would predestine any social media effort to becoming an expensive and embarrassing failure.
In the next several issues, I will address social media and its attendant reputation-related risks. This article will only address one facet of one part of the overall effort to mitigate risks – training of employees. In other words, this is not exhaustive. But each section will serve to help one be more vigilant and prepared.
The highly regulated financial industry, combined with the viral nature of social media and human nature, makes for a volatile mix. It is imperative that employees be educated about the bank’s social media policy and the expectations surrounding adherence to the policy in the use of personal social media.
1. Privacy is Paramount
Customer information is always private and confidential. Recognizing I am stating the obvious, breaches still happen, so forgive me. No employee should discuss customers’ private information in social media (or in any manner). In that same privacy context, do not use social media (company’s or personal) to discuss specific matters with customers or potential customers. To discuss private information via non-private third-party websites or apps risks violation of privacy as set forth in Gramm-Leach-Bliley and other applicable law. Social media is not the right medium to transact customer business.
2. Customer Relations
The adage about a “customer always being right” extends to social media. Employees should be instructed not to complain about customers (even without specificity) in personal social media posts. There is no doubt that many bank employees, especially the frontline staff, have to endure some disrespectful customers. But none should attempt to vent on Facebook, Twitter, Tumblr, Instagram, or any other third-party social media platform. Beyond the fact that venting on social media is not productive, such posts reflect poorly on the bank, employees and reputations. There is also the real problem that such posts may lead to the disclosure of private customer information. Social media should be feared for its ability to reach lots of people and not used as a surrogate therapist.
3. Do Not Advertise for the Bank
Employees should be told not to market for the bank in personal social media usage. If an employee does so, it may trigger the bank’s obligation to take certain steps to ensure employees’ postings are accompanied by the proper disclosures and do not otherwise violate the law, such as the Regulation Z, Equal Credit Opportunity Act, or the Truth in Savings Act. Beyond it being potentially expensive to be found in violation of these rules, it could also damage the bank’s reputation if customers or potential customers were shown to be deceived by the employee’s posts. Again, employees should understand to not mix work with social media.
Problems with social media may arise regardless of what steps are taken. Thankfully, bankers understand it is not possible to eliminate all potential risks (or at least most bankers do...), but one can make great strides in mitigating reputational risks, like all risks, with good planning, vigilance, and training. It may not be easy, but it is doable.